Cheapest Small Business Insurance for June'25

Next Insurance is the cheapest business insurance provider with a MoneyGeek score of 95 out of 100. Their general liability coverage for 20-employee LLCs ($29 monthly) and professional liability rates ($241 for LLCs, $41 for sole proprietors) deliver good value. While their workers' compensation rates aren't the lowest, their overall pricing structure makes them the top choice for comprehensive coverage.

Cheapest Business Insurance Companies:

1. Next (Score: 95) - Offers the most affordable general liability insurance for businesses with employees ($29/month) and best professional liability rates across both business types. Particularly ideal for businesses prioritizing these common coverage types.
2. Thimble (Score: 91) - Features the best general liability rates for sole proprietors ($22/month) and the lowest workers' compensation premiums ($149/month). Perfect for independent contractors and small businesses focused on controlling workers' comp costs.
3. The Hartford (Score: 88) - Provides balanced coverage with mid-range pricing across all categories. With strong professional liability offerings and over 200 years of experience, they're an excellent choice for businesses seeking reliability and stability.

The table below details the monthly costs of general liability, professional liability, and workers' compensation insurance for all the companies featured on our list. The table also includes MoneyGeek scores for each company representing their overall affordability.

Remember, the cheapest policy may not always be the best for your business. It's important to balance cost with the quality and extent of coverage to protect your business adequately.

Most businesses need general liability insurance to protect against third-party injury and property damage claims, and workers' compensation insurance if they have employees. Professional liability insurance is essential for service-based businesses, while commercial property insurance protects physical assets and equipment. The specific combination depends on your industry, business structure, and operational risks.

General Liability Insurance

• Foundation of business protection
• Covers third-party bodily injury, property damage, and advertising injury claims
• Average costs range from $22-$126 monthly depending on business size and type
• Next offers most competitive rates for businesses with employees at $29 monthly

Professional Liability Insurance

• Also known as errors and omissions (E&O) insurance
• Protects service-based businesses from claims of professional mistakes or negligence
• Costs vary significantly from $41 monthly for sole proprietors (through Next)
• Can reach $1,838 monthly for LLCs with 20 employees (through Thimble)

Workers' Compensation Insurance

• Required in most states for businesses with employees
• Covers medical expenses and lost wages for work-related injuries or illnesses
• Thimble offers the most affordable option at $149 monthly
• Other providers range from $165-$200 monthly for businesses with 20 employees

Commercial Property Insurance

• Protects business assets, including buildings, equipment, inventory, and furniture
• Covers damage from perils like fire, theft, and certain natural disasters
• Costs typically range from $33-$63 monthly
• Pricing depends on property value and location

Business insurance costs depend on several key factors that determine how much risk your company presents to insurers. High-risk industries like construction pay much more than low-risk businesses like consulting, while larger companies with more employees and revenue face higher premiums due to greater exposure. Your location, claims history, and chosen coverage levels also significantly impact what you'll pay, making it important to understand these cost drivers when shopping for insurance.

Business Type and Industry

• Risk classification varies dramatically by industry
• High-risk sectors (construction, manufacturing) face substantially higher premiums
• Professional services or retail businesses typically pay lower rates
• Insurance companies use classification codes to determine base rates for each industry

Business Size and Revenue

• Larger businesses face higher insurance costs due to increased exposure
• More employees, higher revenues, and greater assets increase premiums
• Insurance costs often scale with business size
• Particularly impacts coverage like workers' compensation

Location

• Geographic location significantly impacts insurance rates
• Varies due to state regulations, local claim patterns, and natural disaster risks
• Coastal areas prone to hurricanes face higher premiums
• Regions with earthquake risk can pay 2-3 times more than similar businesses in lower-risk regions

Claims History

• Previous insurance claims directly affect future premiums
• A single claim can increase rates by 10-40% for several years
• Many businesses choose to pay minor claims out-of-pocket
• Clean claims history helps maintain lower premiums

Coverage Limits and Deductibles

• Higher coverage limits provide greater protection but increase premium costs
• Lower deductibles result in higher monthly premiums
• Finding the right balance is crucial for cost-effective coverage
• Consider your risk tolerance when setting these levels

Risk Management Practices

• Strong safety programs, security measures, and documented policies qualify for discounts
• Many states offer workers' compensation discounts of 5-15% for safety programs
• Preventative measures can significantly reduce premiums
• Demonstrates lower risk profile to insurers

Years in Business

• Established businesses typically qualify for better rates than new ventures
• Insurers have more data to assess risk profiles and stability for older businesses
• New businesses often pay higher initial premiums
• Rates may improve as business demonstrates stability over time

Number of Employees

• Employee count directly impacts workers' compensation costs
• Premiums calculated based on payroll and job classifications
• More employees in higher-risk positions result in higher insurance costs
• Staffing changes should prompt insurance review

Based on MoneyGeek’s 2025 nationwide analysis, the most affordable business insurance providers are NEXT, Thimble, The Hartford, Nationwide, biBERK, and Hiscox. However, the cheapest for your business depends on factors like the number of employees you have, your desired coverage, your industry, and more.

View the answers to your questions below to better understand where and how you can get cheap business insurance.

MoneyGeek created a scoring system to compare small business insurance companies across cost metrics and ranked them based on affordability. We chose these companies based on their broad national coverage and ability to provide an online quote.

Small Business Sample Profile

We gathered quotes for two types of software development companies:

• An LLC with five years in business, 20 employees, $5 million in annual revenue and $1,250,000 in annual payroll costs.
• A sole proprietorship with five years in business, no employees, $500,000 in annual revenue and no payroll costs.

Quote Collection

MoneyGeek collected general liability, workers’ compensation and professional liability insurance quotes from six insurance companies across all 50 states. The policy limits varied by insurance type:

• General liability: $2 million aggregate limit, $1 million occurrence limit and $0 deductible
• Workers’ compensation: $1 million total policy limit, $1 million per accident limit and $1 million per employee limit
• Professional liability: $1 million per occurrence limit, $1 million aggregate limit and $5,000 deductible

MoneyGeek Scoring Methodology

In our unique scoring system, companies can earn up to five points in each of our five categories. We then use these category scores to calculate a MoneyGeek affordability score out of 100. We applied the following weightings to score insurers:

• General Liability Affordability for LLCs: 20%
• General Liability Affordability for Sole Proprietors: 20%
• Professional Liability Affordability for LLCs: 20%
• Professional Liability Affordability for Sole Proprietors: 20%
• Workers’ Compensation Affordability for LLCs: 20%

Learn more about MoneyGeek's business insurance methodology.